Microsoft to Invest US$100 Million in Research, Development and Entrepreneurial Initiatives in Brazil

Rio de Janeiro’s first natural gas plant, founded by one of the earliest Brazilian entrepreneurs, is about to take on a new century, a new industry and new residents. Microsoft announced today a US$100 million investment in a series of research, development and entrepreneurial initiatives in Brazil, to be hosted in the Barão de Mauá building, a historic heritage site of the city of Rio.

Microsoft’s investment is closely aligned to the Brazilian federal information technology plan, TI Maior, put forward by the Ministry of Science, Technology and Innovation, which seeks to promote national development and a generation of new opportunities for the country in the area of IT. Microsoft executives today outlined the key components of its investment during a public ceremony in Brasilia with Marco Antonio Raupp, Minister of Science, Technology and Innovation, and Aloizio Mercadante, the Minister of Education. The components include:

· Establishment of a Microsoft Research Advanced Technology Laboratory (ATL) in Brazil, the fourth of its kind in the world. The ATL will combine the Brazilian capacity for technological innovation and advanced engineering with expertise in applied research provided by Microsoft and its worldwide partners.

· Creation of a center for the development of Microsoft’s search platform, Bing

· Opening of a business accelerator in conjunction with the City of Rio, through its investment promotion agency, Rio Negócios (Rio Business) to support 15 start-ups over a period of 24 months.

· Incorporation of an investment fund, Microsoft Participações, a new wholly-owned subsidiary of Microsoft Brazil, which has just been established to invest in Brazilian start-ups.

"We are proud of this important step our company is taking to contribute to the goal of making Brazil a global science and technology powerhouse,” says Hernan Rincon, President of Microsoft Latin America. “We share a common belief with the government of Brazil that scientific research will make the country more competitive. With our work to foster the productive transformation of the country, to support the eradication of poverty and promote equality, to help increase the quality of education, to improve urban infrastructure and to guarantee public safety, we are more optimistic than ever about the future of Brazil and deeply honored about our role in helping realize the country’s potential.”

The focus of the ATL Brazil will be on data analysis and understanding, and information retrieval, using advanced information retrieval and machine learning techniques. According to Henrique (Rico) Malvar, Chief Scientist at Microsoft Research, “we have a long history of partnerships with academic researchers in Brazil. Now, with a permanent presence in the country, we are committed to promoting long-term collaborations in the areas of science, education and scientific research.”

The decision to invest in a business accelerator is based on Brazilian market realities. According to a survey conducted by the country’s start-up agency (SEBRAE), 22 percent of small enterprises born in Brazil go out of business within two years of creation. Data from the national development bank (BNDES) shows that small- and medium-sized enterprises account for about 80 percent of the companies in Brazil and generate more than half of the country’s total IT spend.

Start-ups will receive all the support provided by the project, including mentoring for in the areas of administration, management, finance, legal, public relations, marketing, design, development and sales channels; support in the development and implementation of business plans; operational support offered by angel investors and mentors; technological support, by which all participants will have access to Microsoft software, training, capacity building and technical support; a physical space to host each start-up and availability of meeting rooms to receive clients and partners; and business networking opportunities for start-ups to be put in contact with partners and potential investors.

"The success of these start-ups is critical to the competitiveness of Brazil, because they create jobs, boost growth and innovation, and many of them turn into multinational corporations,” says Michel Levy, general manager, Microsoft in Brazil. “The establishment of this business accelerator, as well as the other initiatives announced by Microsoft this week as part of the larger Federal Government IT initiative, represent a significant investment by our company in Brazil. Our hope is to foster the exchange of knowledge amongst research teams, universities, start-ups and the Brazilian market, supporting the City of Rio’s transformation into in a great technological hub."